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Steel chief warns Cheesegrater bolt costs may top £6m


The chief executive of steel specialist Severfield has warned the cost of replacing steel bolts on the Cheesegrater may rise above the £6m figure flagged with the City

The company has also had to reinstall bolts on the £650million US Embassy in Nine Elms just months after it was forced to start replacing 3,000 bolts on the Leadenhall Building, commonly known as the Cheesegrater, where three bolts fractured last winter, causing part of one to fall to the ground.

Severfield announced in June that the cost of replacing the bolts on Rogers Stirk Harbour + Partners’ landmark London skyscraper could run to £6million. When asked by AJ’s sister title Construction News if this was the maximum cost, Severfield’s CEO Ian Lawson said it would be ‘wrong’ to assume that.

‘It’s very much our estimate of what we think our final costs will be to carry out the remedial works,’ he said.

The bolts on the Cheesegrater failed due to a process known as hydrogen embrittlement. According to Lawson, the steel used had all of the correct certification, but the bolts turned out to be harder than they should have been, meaning they were more susceptible to embrittlement.

In an exclusive interview with Construction News, Lawson tackled the issue of whether the firm’s reputation had been damaged by the incident, but insisted its ‘honest’ approach would secure client relationships.

The company is still in talks with client British Land, as well as Laing O’Rourke and Arup, over where the ‘true liability’ for the Cheesegrater bolts lies, with all parties picking up their own costs as work continues.

Lawson said his firm had handled the saga with ‘integrity and honesty’ which had ‘stood them in good stead’ – and added that relationships with British Land and Laing O’Rourke were positive, with Severfield still bidding for work with them on other schemes.

Big Interview

Read the interview, in full, with Severfield chief executive Ian Lawson.

Despite these issues, Severfield has announced improved results with a pre-tax profit of £144,000 for the year ending 31 March 2015, following losses of £2.6million the previous year.

He was speaking after it emerged that the firm would also have to fit replacement bolts on the US Embassy.

The CEO told Construction News that the company’s reputation had ‘not been helped by what’s happened’.

Lawson added: ‘It’s [Leadenhall] that people are cottoning onto, thinking ‘Ah, [the US Embassy job] could be horrific’.’

Severfield is having to replace bolts on the Nine Elms site after installing the wrong ones, although it is understood that those bolts were supplied by a separate company.

Despite the different nature of the problems, Lawson acknowledged that people would connect the recent setback with the Cheesegrater.

‘Inevitably, with somebody, somewhere, it will [harm our reputation],’ he said, but insisted that most contractors and clients recognised that the Cheesegrater was a ‘peculiar, one-off’ design.

Severfield’s share price dropped 5 per cent the day the US Embassy news broke, although it has since recovered.

Lawson said: ‘Obviously some investors or shareholders have seen that and wondered if there’s another problem.’

Work at the Cheesegrater is set to finish by the end of 2015.



Readers' comments (2)

  • If the steel used in the Cheesegrater bolts had all of the correct certification, but the bolts were substandard, does this mean that the certification is unfit for purpose, or the bolt manufacturing process unexpectedly modified the steel characteristics post-certification, or the certification was falsified? Does this affair have wider implications for structural engineering?

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  • A full explanation of hydrogen embrittlement would be very useful. On the face of it a chap on the Clapham omnibus would think a harder bolt would appear to be a distinct advantage with a better built in safety factor.

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